Less roles for expats as companies feel financial pinch

Less roles for expats as companies feel financial pinchFinancial constraints imposed by the downturn is having an effect on the way companies shift expats around the world to fill posts, according to a new report.

A global talent mobility survey by international consultants Towers Watson looked at three key questions:

  • How are organisations headquartered in Asia, Europe and the United States changing the way they approach talent mobility as part of their talent management strategy?
  • How different are the existing policies and processes across these three regions?
  • How effective is the current mobility structure in attracting and retaining key talent?

Among the key findings from more than 100 companies revealed :

  • Despite cost pressures imposed by a sluggish global economy, most multinationals expect international assignments to increase through 2014, and only 18% see them reducing.

More than half (54%) of headquartered in the US and 43% in Asia expect the level of international assignments to rise. European organisations remain cautious – with two-thirds expecting a decrease.

  • 60% of Asian companies and 40% of US organisations transfer employees to China for expat assignments.

Europe-headquartered companies transfer their expats to various locations — mostly to the UK and Singapore.

European companies prefer to keep short term assignments local, with 50% moving within Europe. Asia is the most popular region for short-term assignees for Asian (85%) and U.S. (58%) companies.

  • 69% of companies cite prohibitive costs as a major hurdle to professional mobility, while more than half feel housing costs (55%) and the cost-of-living (51%) is too high in many cases. Immigration issues appear to be an issue for US companies as they try to develop talent from emerging markets.

“Top worries for expats include education issues, cultural adaptability and tax,” said the report.

“Nevertheless, cultural adaptability is often overlooked by employers — only 19% cite it as a challenge in selecting candidates for international assignments.”